I don’t really know what to tell you about Herbalife’s investor day presentation this morning. One thing that’s definitely true is that it was shorter than Bill Ackman’s anti-Herbalife presentation a few weeks ago, which the Herbalife team seemed inordinately proud of, since, like, the Ring Cycle is shorter than Ackman’s presentation. It was … guys, honestly, it was creepy, the word is creepy. Here is where Herbalife’s president, Des Walsh, made me particularly uncomfortable:

“It’s about a shake, a tea, an Aloe — and a hug. I know in this community, hugging is not something you do a lot. But the world needs more hugs. And they find them, along with good nutrition, in the nutrition clubs.”

That’s from DealBook’s live blog, which collects the highlights. (DealBook also has a good breakdown of the legal issues involved in “is Herbalife a scam?”) Ackman has already responded, arguing that Herbalife distorted his arguments and failed to address a lot of his points. This is true, though Herbalife definitely scored some “Ackman-is-distorting-our-business” points too; the whole thing seems likely to become a drawn-out contest of two sides talking past each other, at maximum length.1

You can understand why that would happen. Many of Herbalife’s arguments were prefaced with “now I know this may not seem cool to you Wall Street types, but …,” and … and, no, it did not! Everyone told corny stories of people being inspired by weight-loss shakes, and the call ended with CEO Michael Johnson comparing Herbalife to the Girl Scouts. Wall Street, of course, prefers somewhat more concrete metrics: give me some cash flow numbers on those Girl Scouts, Michael!

And those, to be fair, may be forthcoming. Analysts asked for news on last quarter’s earnings, share buybacks, and even a going-private, and while there was no concrete news, Herbalife seemed to at least affirm on earnings. Other concrete steps were also left mostly unspoken: Herbalife refused to say whether it plans to sue the crap out of Ackman, though rumors of the latter persist. Stories like that tend to be a bit more inspirational to investors.

Herbalife Investor Day Presentation [Herbalife]
Herbalife Responds to Accusations From Hedge Fund [DealBook]
What’s at the Center of the Debate Over Herbalife [DealBook]
Ackman Responds: Herbalife ‘Distorted, Mischaracterized’ Our Presentation [MarketBeat]

1. And thus maximum legal bills.

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Comments (9)

  1. Posted by Guest | January 10, 2013 at 5:55 PM

    The R&D expenditure figure on slide #10 tells you all you need to know here.

  2. Posted by herbs4all | January 10, 2013 at 7:02 PM

    who's this GAAP character? Scientific Affairs = R&D

  3. Posted by Concise Levine | January 10, 2013 at 7:02 PM

    Charts were a fucking sloppy joke.

  4. Posted by Naked Shorts | January 10, 2013 at 10:41 PM

    Time for Herbalife to bust out the celery distraction move as it takes itself private… Classic MacGruber!

  5. Posted by Guest | January 11, 2013 at 9:23 AM

    For those who don't want to read the slide: $1mm total for R&D in 2012…

  6. Posted by Guestulus | January 11, 2013 at 9:41 AM

    And Avon's $77mm R&D spend (<1% of revs) would imply what Bill Jr?

  7. Posted by research writers | January 14, 2013 at 7:21 AM

    It's time for HerbaLife to get their back up!

  8. Posted by Peter | January 16, 2013 at 5:16 PM

    Pershing Square Capital Management and Bill Ackman are going to lose big over this. This man has never acted in altruistic fashion in his entire life and this is a shallow attempt to make money by ruining a profitable, trusted brand which employs thousands of people. And to what benefit? His own. Have any of the people actually working with the company complained? No. I hope the company put out of business is his. Where is the financial industries support for the job creators now? Bill Ackman is everything that's wrong with this country.

  9. Posted by sohbet | May 12, 2013 at 6:23 PM

    telling these little stories, here's a good idea: Have a point. It makes it so much more interesting for the listener.